President Biden signed a bill Wednesday morning that gives China’s ByteDance up to one year to divest TikTok or face a US ban on the app.
Social media stocks were little changed following the news.
Yahoo Finance’s Ben Weschkul reports on what could come next:
The long-debated measure is fraught with political implications for the 2024 election and will also kick off a complex set of steps over the coming 12 months likely to take place both in boardrooms and in courtrooms.
The bill gives the company 270 days to sell, but the president can extend the deadline up to a year. The process could end with a ban on an app that is currently used by more than 170 million monthly users in the US.
This is another front in the ongoing US-China trade war that started during the Trump administration,” Georgetown business professor Stephen Weymouth said in an interview this week.
He noted that the aggressive law will likely spur reactions from many fronts — including possible retaliation by the Chinese government. Previously, “Congress has had a relatively hands-off approach to tech regulation overall,” he said.
The effort comes after lawmakers and the Biden administration have repeatedly charged that TikTok poses an urgent national security threat because the Chinese government could compel the company to share its data.
TikTok itself has denied the Biden administration’s charges and insists it would never share US data. It has responded to this week’s action on Capitol Hill by charging that the law will be “a ban bill that would trample the free speech rights of 170 million Americans.”
TikTok and ByteDance have also said that they have no intention of trying to sell, saying in a recent statement that the effect of passage will be to “shutter a platform that contributes $24 billion to the US economy, annually.”
But it’s unclear if the company will change tack and begin actively looking for buyers now that the law is on the books.
